Mariano Maluf
Janakan Rajendran

New technology systems help hospitals cut costs as they prepare for rapid growth in radiology imaging.

At a Glance   

  • Vendor-neutral archives (VNAs) normalize PACS images and make image exchange possible, even when multiple divergent PACS or radiology departments are involved.
  • These systems, onsite or cloud-based, allow for strategic and long-term growth regardless of the PACS used.  
  • Radiologists continue to operate with their system/vendor of choice, further strengthening productivity, satisfaction, and organizational loyalty.  
  • Finance executives shave costs, avoid future PACS expenses, and gain greater leverage with PACS vendors.  

Healthcare providers and their IT departments are challenged with capturing, storing, and protecting massive amounts of data. Greater demands for data storage have increased IT budgets and data management costs.

According to industry experts, most data are image-based and produced by radiology services. In fact, medical images account for up to 80 percent of data volume in electronic records and support 60 percent of all patient diagnoses. Picture archive and communication systems (PACS) used by radiology services are expensive to purchase and expensive to maintain. With rapid growth in radiology and other medical imaging modalities, there is no end in sight.

A new option for storing medical images, called a vendor-neutral archive (VNA), is available that can help hospitals accommodate service line growth, PACS integration requirements, and technology shifts.

A VNA can store and exchange images at a lower cost than can traditional PACS-based image storage. It also can provide more flexibility for future growth, PACS replacements, ACO migration, integration, and exchange. Moreover, this approach can reduce radiology capital equipment costs and staffing requirements, while protecting radiology preference and viewing flexibility and allowing users to view images and data in any PACS format.

From a cost perspective, savings are immediate while long-term costs are avoided. Hard dollar savings come through consolidated storage across modalities, lower infrastructure costs, and fewer support resources with cloud-based options. Soft dollar savings focus on stronger contractual positioning with PACS vendors, shorter time to diagnosis, and satisfaction among radiologists.

Ultimately, the move from proprietary PACS-based image storage to a VNA is justified on cost savings and future cost avoidance. With quality of care and PACS vendor independence improving, moving to a VNA would seem to be an easy decision for finance executives.

Image Storage Concerns and the Future

Two primary factors are driving the growth of radiology image storage requirements: the expanding volume of procedures and the improving granularity of exams. New equipment can generate more images of the human body with resolutions that are dramatically higher. In trying to control costs while making images easily accessible for patient care, research, and other clinical uses, hospitals are forced to negotiate with the "owner" of the medical images, the PACS vendor.

Most of the PACS archives store data in a proprietary format and lock the hospital into one manufacturer. The PACS vendor effectively "owns" the images due to the vendor's customized, proprietary formatting of the DICOM archive data.a Costs of migrating to newer storage or software are substantial even when hospitals remain with the same PACS vendor.

This situation poses an increasingly significant challenge under healthcare reform. Accountable care organizations (ACOs) require the combining of images from disparate systems and across multiple provider locations and modalities, an extremely difficult and expensive process when the images are trapped in individual PACS-based silos.

A VNA can circumvent these challenges by integrating images from disparate sources and reducing overall image archival costs, particularly when the VNA is cloud-based. Such a VNA is highly compatible with imaging industry growth and the integration demands of ACOs. Nonetheless, adoption of a VNA, whether cloud-based or on-site, warrants careful analysis.

Analyzing the Opportunity

VNAs serve as translators to convert image information for transmission between the archive and proprietary PACS. VNAs support long-term medical image storage, migration, life cycle maintenance, and interoperability, thereby providing greater flexibility and current cost savings as well as future cost avoidance.

When VNAs are hosted by a third-party data service or cloud-based vendor, there are little to no capital costs for IT infrastructure-only monthly operational costs for the hosting service. Staffing to manage the VNA is outsourced, further reducing the IT department's workload. There is little to no impact on existing clinician workflow. Cloud-based VNAs also move costs from the capital budget to the operating budget, a potential advantage for budget-constrained healthcare providers.

When analyzing the relative merits of adopting a VNA, healthcare finance leaders should, in the very least, consider the key benefits of the technology, IT staffing requirements, the hard and soft savings that a VNA can generate, and potential pitfalls for the organization in a adopting a VNA strategy.

Three Key Benefits of Cloud VNAs

A cloud VNA offers three key benefits. First, it allows for long-term archival of images from all departmental PACS (e.g., radiology, cardiology, interventional) without extensive hardware requirements. Image storage is no longer on-site at the provider location, reducing the provider's capital equipment costs and staffing requirements.

Second, the VNA includes a universal viewer, or univiewer. Without this feature, the healthcare provider would have to build and maintain individual interfaces between its EHR and each PACS workstation. Moreover, physicians would be required to learn and use separate PACS viewers, which is not desirable, given physicians' preference to use the PACS viewer and technology they understand. VNAs allow for physician preference, mobility, and viewing flexibility.

Third, a VNA can perform bidirectional mapping and normalization of information, which is key to the archive's vendor neutrality. By allowing for image normalization and inbound-outbound exchange regardless of which CT, MRI, or X-ray device generated the image, the VNA supports information flow to and from a provider's vendor-specific environments, which is the essence of true interoperability.

The Human Cost of VNAs

Despite its clear cost advantages, a VNA does require IT staff support in three areas.

First, and perhaps most important, is the need to maintain compliance with the provisions of the Health Insurance Portability and Accountability Act, requiring a security system with access management and audit log capability. The healthcare provider's IT staff should be the guardians of this system.

Second is the need to monitor and maintain lifetime image management. Complex, state-by-state rules determine how, when, and whether an organization can delete an image. This complexity has led many organizations to avoid the problem by storing the images on each PACS' archive in perpetuity-a costly alternative. A VNA can allow for moving the provider's archive to less costly storage. Some VNAs can automatically manage the deletion process for the provider's images, which can also save money and time. In essence, adding information lifecycle management to the overall VNA strategy can be beneficial over both the short- and long-term.

Third, the formatting library that morphs information between systems requires a systems administrator. This resource, whether provided by the hospital or a cloud vendor, will fix any mapping issues and maintain vendor communication. The administrator will also monitor storage consumption to fully maximize cost savings relative to image storage. Having medical images cached and residing on local servers expedites availability, but at a higher cost than just-in-time options, requiring an understanding of the organization's specific requirements. A well-designed VNA solution will accommodate multiple scenarios ensuring response time and overall efficiency are maintained.

The best practice is integrating the VNA into the scheduling systems. This approach allows for pre-fetch capabilities-that is, bringing any historical images to a local server before a patient presents in the clinical service-thereby eliminating the need to store images and information locally for frequent "on-demand" access to the archive.

Radiology-A New Place for Cost Savings

Finance executives generally prefer to use cost models for purchase justification that use hard costs. A VNA cost model with hard costs only will provide savings and justification on a stand-alone basis. But there is another tangible benefit in implementing a VNA: high-quality patient care, which goes beyond any benefit derived from true disaster recovery and business continuity.

Soft savings. The ability to have a true longitudinal look at a patient's health record, viewable from a single device, gives the healthcare professional a productive route to providing high-quality care. Saving physician time is a benefit that all hospitals seek. The unified view of all medical images over time decreases the need for patients to have repeated procedures, which saves unnecessary exposure to radiation.

Another benefit is stronger contractual positioning with regards to PACS decisions. Most VNA cost models go out at least five and preferably 10 years. In that period, how many PACS upgrades, vendor changes, and enterprise expansions will occur?

The VNA gives radiology departments the leverage to pick and choose which PACS vendors are best for the institution. Currently, existing PACS vendors often hold the leverage because of budget constraints that impede hospitals' ability to account for radiologists' preferences.

It can be in a hospital's best interests, however, to give radiologists the freedom to use the PACS technology they prefer. With a VNA, radiologist groups can make their own choices among vendors, instead of being forced to use a single, consistent PACS platform across clinicians and disparate imaging service lines.

Executives who can accommodate the radiologist group's desire for a specific system gain a competitive advantage. CFOs can make those changes without the huge cost of moving old images to a new vendor. Improved physician relations are an important benefit that should be reflected in any financial impact statement.

Hard savings. Identifying hard dollar savings achieved with conversion from individual PACS-based image storage to a VNA requires some effort. To analyze these savings, the true costs of the silo-based, heterogeneous departmental PACS with their proprietary archives must first be carved out for comparison. Then, those costs can be compared with the chosen VNA scenario, whether on-site and self-managed or hybrid and cloud-based.

Comparisons with an on-site, self-managed scenario are likely to disclose that a VNA would have a lower total cost of ownership because the VNA approach consolidates storage, employs a univiewer, decreases infrastructure costs, and lowers support resource needs.

In essence, the VNA is a less complex environment when compared with a multi-PACS environment. A VNA achieves major cost avoidance by eliminating the multiple interfaces required between the EHR and each PACS environment. These are replaced by a singular interface between the EHR and the VNA.

Further cost savings can be achieved by using a hybrid model VNA, where an off-site vendor provides services in a cloud-based environment.
A hybrid VNA allows for:

  • Just-in-time storage
  • No second data center
  • Operating expenses instead of capital expenditures
  • System management performed by the vendor (fewer IT staff needed)

Potential Challenges

Although VNAs solve many issues in radiology image management, there are documented pitfalls and challenges. First and foremost, the same image migration from PACS to VNA must be conducted as it would occur when moving from one PACS to another. However, once moved into the VNA, providers are not locked into a single- vendor imaging strategy, providing greater vendor flexibility.

Many organizations are already dealing with multiple PACs vendors for different modalities. Again, this approach can be advantageous to the extent that it reflects the organization's decision to give radiologists choices for best-of-breed PACS and viewers. On the down side, however, executives must manage multiple PACS vendors. Using a single-vendor imaging strategy for all disciplines may not give radiologists the best equipment, but the organization only works with one vendor.

Short-term financial implications also play a role in implementing a VNA. Although the costs are greatly reduced with a cloud-based VNA, on-premise solutions are more expensive than just a regular, PACS-based image archive. Savings from on-premise VNAs come in future cost avoidance. Mid- and long-term scenarios justify the up-front costs.

Cloud-based VNAs neutralize this concern. Organizations can start small and grow as needed, minimizing the up-front costs. The same applies from project implementation cost perspectives and overall business disruption cost avoidance as cloud-based VNAs support a phased-in approach. A thorough assessment and sound, phased strategy that minimizes impact and provides small, but tangible benefits quickly is recommended.

Finally, common VNA resistance factors are organizational readiness or unwillingness to make the investment due to other priorities or lack of funding. If images are standardized across the organization and image storage/maintenance costs are low, a VNA is probably not needed. And if an organization has no plans to acquire new entities with disparate PACS vendors or no need to exchange images across systems, the need to implement a VNA is fairly low. An organization that has broad strategic plans to expand it's delivery system, however, is likely to benefit from a VNA approach.

Time to Rethink Radiology Image Storage

Deployment of a cloud-based VNA can help providers decrease costs and spur interoperability, which is a requirement both for ACOs and for meeting the meaningful use requirements under the Health Information Technology for Economic and Clinical Health Act. The upgrades to disaster recovery and business continuity are added bonuses.

Given these potential benefits, healthcare finance leaders should develop a clear understanding of how VNAs work and their long-term cost advantages, particularly in helping their organizations successfully meet the challenges in the era of healthcare reform.

Mariano Maluf is chief technology officer, GNAX Health, Atlanta (

Janakan Rajendran is chief information officer, GNAX Health, Atlanta (


a. DICOM (Digital Imaging and Communications in Medicine) refers to the global IT standard for the production, management, and transmission of medical imaging. DICOM is managed by the Medical Imaging & Technology Alliance, a division of The Association of Electrical and Medical Imaging Equipment Manufacturers.

Sidebar 1

Five Questions to Ask Your PACS Vendor   

  • Can data and images from other PACS vendors be included in your archive?  
  • Does your system normalize inbound and outbound data and images?  
  • How easily can we migrate from your PACS archive to a true VNA? What is the cost?  
  • Can your PACS archive exchange data and images as required by ACOs and Meaningful Use requirements? 
  • What is the long-term cost by study and by year to store data and images? 

Sidebar 2

Medical Images in a Disaster  

Disaster recovery, mandated by the Health Insurance Portability and Accountability Act, is one benefit from implementing VNAs.

It can be as simple as having a second copy of data stored remotely, which can be accessed whenever necessary. Using a more elaborate cloud-based storage system will accommodate a true disaster, such as tornadoes or hurricanes. The cloud-based system provides multiple data centers that are geographically dispersed.

With a disaster system in place, it is not difficult to mirror all the software and hardware that are used. Clinicians have full business continuity in the event of a large failure. From an IT perspective, full-mirrored redundancy can also be used for load balancing, which improves overall system performance and keeps physician users happy. 

Publication Date: Wednesday, February 01, 2012

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